Mina Tadrus, et al.

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 25823 / September 8, 2023

Securities and Exchange Commission v. Mina Tadrus et al., No. 1:23-cv-5708 (E.D.N.Y. filed July 28, 2023)

SEC Obtains Preliminary Injunction and Asset Freeze Against Florida Resident in Connection with Ponzi Scheme Targeting Religious Community

On August 22, 2023, the Securities and Exchange Commission obtained a preliminary injunction against Mina Tadrus and Tadrus Capital LLC related to an alleged Ponzi scheme.  The injunction, among other things, prohibits the defendants from violating the charged antifraud provisions of the federal securities laws and imposes an asset freeze pending a final resolution of the matter.

The SEC’s complaint alleges, since at least September 2020, Tadrus and Tadrus Capital solicited and sold investments in Tadrus Capital Fund LP, a purported pooled investment vehicle that targeted members of the Egyptian Coptic Christian community. The defendants allegedly raised more than $5 million from at least 31 investors and falsely told them that their funds would be pooled and invested using algorithmic trading that would guarantee a steady monthly return on investment (ROI). However, the complaint alleges, the defendants did not actually invest the investors’ funds as promised. In reality, according to the complaint, the defendants used at least $1.4 million to make purported ROI payments to other investors in Ponzi fashion and otherwise misappropriated at least $380,000.

The complaint, filed on July 28, 2023, in the U.S. District Court for the Eastern District of New York, charges Mina Tadrus and Tadrus Capital LLC with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder. The SEC is seeking permanent injunctive relief, disgorgement, and civil penalties against both defendants, and a conduct-based injunction and officer-and-director bar against Mina Tadrus.

The SEC’s investigation was conducted by John Lehmann, Doreen Rodriguez, Abigail Rosen, and Lindsay S. Moilanen, and supervised by Tejal D. Shah. The litigation is being handled by Ms. Rosen and Mr. Lehmann.  The SEC appreciates the assistance of the U.S. Attorney’s Office for the Eastern District of New York, the FBI, and the IRS.